Wouldn't the argument be that resuming student loan payments is deflationary because it takes cash out of the economy, and partial student loan forgiveness just lessens the possibility of large scale bankruptcies which could be another shock to an already fragile system?
inflation results from a suddenly plummeting rate of profit - businesses have to increase prices to make up the sudden shortfall. removing cash from the economy can reduce liquidity and make the problem worse.
If the system's heavily inflating it's not really fragile. And Biden is extending the payment moratorium for two more months anyway, isn't he? Though the resumption of payments logic does make sense.
This op-ed is too long so I skimmed it but I didn't see the point where the author actually made the point why it would be deflationary.
It's not inflationary, he's right, for the reasons he listed here - people are already spending that money, so inflation won't go up any further.
Wouldn't the argument be that resuming student loan payments is deflationary because it takes cash out of the economy, and partial student loan forgiveness just lessens the possibility of large scale bankruptcies which could be another shock to an already fragile system?
inflation results from a suddenly plummeting rate of profit - businesses have to increase prices to make up the sudden shortfall. removing cash from the economy can reduce liquidity and make the problem worse.
If the system's heavily inflating it's not really fragile. And Biden is extending the payment moratorium for two more months anyway, isn't he? Though the resumption of payments logic does make sense.